Seoul Stocks Tumble Nearly 6% as AI and US Inflation Fears Hit Sentiment
South Korea’s benchmark KOSPI fell 5.8% shortly after Thursday’s opening, triggering a sell-side sidecar as chipmakers led a broad retreat amid doubts about AI returns and hotter-than-expected US inflation.
South Korean stocks plunged in early trading Thursday as renewed doubts about the sustainability of the artificial intelligence boom and stronger-than-expected US inflation drove investors away from riskier assets.
The benchmark Korea Composite Stock Price Index dropped 348.47 points, or 5.8%, to 5,660.34 as of 9:15 a.m. after opening sharply lower. The abrupt decline prompted the Korea Exchange to activate a sell-side sidecar, a mechanism that temporarily limits the effect of program selling when futures prices move sharply.
The fall extended the Seoul market’s losing streak to a sixth consecutive session and put heavy pressure on the country’s largest technology shares. Samsung Electronics lost more than 6%, while SK hynix fell more than 8%, as the two chipmakers moved in step with overnight weakness among US technology companies. Both Korean firms are closely watched as major suppliers in the global semiconductor and AI infrastructure cycle.
Other large-cap shares also declined. Hyundai Motor dropped 4.31%, biotechnology company Celltrion retreated 1.39%, and Hanwha Aerospace edged down 0.24%. The broad losses showed that concerns originating in technology and overseas markets had spread across multiple sectors of the Korean market.
Investor caution followed a negative session on Wall Street. The S&P 500 fell 1.11%, while the technology-heavy Nasdaq Composite declined 1.88%. Sentiment was hit by continuing questions over whether the large sums being invested in AI infrastructure and services will produce returns quickly enough to justify elevated valuations.
Inflation data added another source of pressure. The US consumer price index rose 0.6% in September from the previous month, taking the annual inflation rate to 3.7%. That was slightly above economists’ expectation of a 3.6% annual increase, reinforcing concern that price pressures could complicate the outlook for US monetary policy.
The Korean won traded at 1,343.3 won per US dollar at 9:15 a.m., one won lower than the previous trading session’s close. Currency weakness can amplify caution among foreign investors because it affects the value of won-denominated holdings when converted into dollars.
The sharp opening move underscored Seoul’s sensitivity to shifts in global technology sentiment and US inflation expectations. Investors will be watching whether the sidecar helps stabilize trading and whether losses moderate as Thursday’s session progresses.